In the future, it will be increasingly difficult to profit from selling new cars. This is because fewer new cars are on the market, and electric vehicles don't need as much maintenance. Because of this, dealerships that excel in used cars sales will always stay afloat.
But how do you make sure your pre-owned vehicles are going to turn faster?
One way to do this is by participating in certified pre-owned vehicle programs. With these programs, you can guarantee the quality and condition of your certified pre-owned cars.
This informative article will keep you up-to-date on trending strategies for making sure your pre-owned vehicle inventory turns faster.
First off, as a dealership, you need to recognize the advantages of selling pre-owned vehicles. Here are 5 reasons why pre-owned vehicle sales are a great choice for dealerships:
Pre-owned vehicles offer affordability for customers because they are typically less expensive than brand-new vehicles. This can be especially appealing to buyers on a budget or those looking to save money on their purchases.
Owning a pre-owned vehicle also helps you avoid the initial drop in value that comes with buying a new car. Because pre-owned vehicles have already experienced some depreciation, they are not subject to the same rapid decline in value as a new vehicle. As a result, buyers can get a great deal on previously owned cars.
With complete details, participating dealers receive powertrain limited warranty period protection for pre-owned vehicles. This type of extended coverage can reassure customers interested in purchasing high-end or luxury vehicles — giving them the peace of mind to make a more informed decision.
Another perspective is that pre-owned vehicles also provide access to high-end and luxury models that may be outside the budget of many buyers when purchasing new ones. These vehicles can be purchased at a more affordable price when pre-owned, making them more accessible to a wider range of buyers.
Because they are not limited to the latest models, buyers can choose from a variety of different makes, models, and years to find the right vehicle for their needs. Pre-owned vehicles also provide buyers access to rare or hard-to-find models more quickly than new ones in times of shortage. This quickness to find the right model for customers can make all the difference in dealership sales.
It is really hard to make a diverse selection of new cars when the dealership has limited funds. This is where pre-owned vehicles come in. With pre-owned cars, dealerships can offer more variety to their customers and stand out from the competition without having to invest in expensive new cars.
Achieving higher profits from pre-owned vehicle sales requires a few key strategies and tactics. While making and adjusting inventory decisions is a key part of the process, there are additional tactics that can help you sell more cars.
Some dealers elect to join the factory-certified program to adhesive a factory brand to their products and receive extra marketing support or privileges that other non-brand-certified dealers can't duplicate.
While this might offer an alluring boost to sales, it's essential to understand that some of these programs have tiered benefits based on meeting certain quotas established by the dealer - so make sure you're clear on what exactly you're signing up for before taking part in the CPO program.
Manufacturers have come up with a new way to boost dealers - they're offering increased online listings and the ability to certify other makes and models of cars. It's a fresh take on things, but the catch is that many dealers are required only to offer this program, which can be a disadvantage for their pre-owned operations. Still, the added credibility from certifying other vehicles could be worth it for some.
These new programs from manufacturers might give dealers more options, but they also limit their ability to create a more exclusive offer and maximize profits.
If you want to go above and beyond for your customers, consider offering a home delivery service for both test drives and purchases. This will show your clients that their safety is always a priority for you. If you can manage to offer this additional level of customer service, it will be greatly appreciated.
A robust third-party certification offer empowers dealers to achieve their objectives while maintaining better control at a reduced initial cost. This unique selling proposition provides increased financial benefits to their operations, allowing them to profit more from new vehicle delivery and pre-owned vehicles.
Some dealers are concerned that customers will perceive a different value in a dealer-branded program than a factory-branded option. However, other make and model options with strong third-party branding can be more attractive to the customer.
What's more, this program can also provide include:
- More inventory control than manufacturer-branded programs.
- Transparent pricing can be adjusted based on customer feedback.
- Reduced costs for vehicles with contract limited.
- Quicker disposition of aged inventory.
- Reduced reconditioning costs.
- The ability to source and certify more vehicles from outside sources.
- Lower certification costs result in vehicles that can be resold at a more affordable rate, allowing buyers to receive the vehicles they need without breaking the bank.
- More digital marketing capabilities.
- Higher profitability when vehicles are sold.
No matter what vehicle certification strategy you choose, vehicle history reports should be part of the customer's due diligence.
The vehicle history report should be part of the vehicle certification process and be included in the overall vehicle profile presented to the customer. Make sure you include detailed reports from vehicle history providers that offer vehicle condition reports and other services to help the customer decide on vehicle condition.
Since the purchase of a car is not limited to a physical lot, you should make sure that you are using all available digital channels for vehicle sales. Look into setting up customized vehicle listings on websites, vehicle search engines, and social media platforms. This will help you reach potential buyers more quickly.
Using a tool like Pixel Guru can not only make your team’s life easier when it comes to uploading vehicles to your website and 3rd party marketplaces. It can also make it more attractive to the end customer by raising perception and value of the vehicle they’re conveying.
Yes, it's important to make sure you have a presence on vehicle search engines, but you also want to drive as much traffic as possible directly to your own website. Invest in SEO, content marketing, and other tactics to make sure prospective buyers are landing on your site first.
If you target your ads more carefully, you won't have to rely so heavily on third-party aggregators. You can also redirect shoppers to your website, where there will be fewer ads and a cleaner interface.
No vehicle sale is complete without great photography. Make sure to invest in high-quality vehicle images that will help buyers see vehicle features deeply. Take photos from all angles, and remember to include shots of the vehicle's interior.
Photography is an art that takes years to master. Sadly, most dealerships’ personel are not trained professional photographers. Since our founding team comes from a dealer’s showroom floor, this is something we understand.
This is why it one of the first features to be realeased was the Photo Assistant. It guides you through the photo taking process from A to Z to make sure you didn’t miss a spot. An overlway also guides you to make sure your photos seem like they were taken by a pro.
This makes for a perfect listing without losing time playing around with the vehicles, lighting or expensive editing tools.
Advertising has always been done towards the end of every month. But in recent years, buying processes have changed from being linear to now involving digital retailing. Because of this shift, it's become essential to maintain a consistent connection and presence throughout the entire month instead of only at the end.
A great certified used car program sets your dealership apart from the competition. Whether you are a large dealer group or a single location, having an established program and limited warranty details will give customers a reason to choose your dealership.
Also, don't neglect other strategies we mentioned, such as home delivery, vehicle history reports, digital retailing presence, maintenance visits, high-quality photography, and consistent presence throughout the entire month.
These strategies will help you build trust with customers and give them the confidence and convenience they need to buy a car from your dealership.